FINANCIAL CHEST – Have you started investing? Eits, before starting to invest, you first need to understand the basics of investing. The first thing to understand before investing is to determine your investment goals. Of course, you must first understand that the mindset when investing is different from saving, namely:


  • Set aside money for short-term needs and emergency funds
  • Can be taken/used anytime
  • Fixed returns but relatively low value and risk
  • Example: savings in the bank


  • Develop the money you have to make a profit
  • It takes time to disburse funds
  • High risk high return, ie the risk of loss is proportional to the expected return
  • Examples: stocks, mutual funds, gold, securities and bonds

There is a view that the purpose of investing is to get rich quick, but this is wrong and can lead to greed. If not accompanied by prudence, greed can cause you to actually suffer losses! So what is the real purpose of investing? The following are 2 goals of investing:

1. Securing finances from inflation

In simple terms, inflation can be interpreted as a decrease in the value of a currency. For example, twenty years ago, 100 thousand rupiah could be spent on various needs, but nowadays this amount is only enough to buy a few items due to the impact of rising prices. Well, you need to allocate some of your wealth to investment products that provide higher returns or returns than the inflation rate, so that the value of your money is not eroded by inflation.

2. Achieve financial goals

Financial goals are our efforts to achieve a number of funds to meet a need in the future. Financial goals can be distinguished based on the time period, namely short-term financial goals are usually achieved in less than one year such as buying a new laptop or gadget for work needs. Next is the medium-term financial goals that are usually achieved within one to five years, for example for education funds, mortgage down payments, or pilgrimage. And the last is long-term financial goals that are usually achieved in more than five years, for example for retirement funds and buying a house.

The second thing that needs to be understood before investing is always 2L, namely Legal and Logical. Invest in financial products that are registered and licensed by the OJK, then you should never be in a hurry to choose an investment instrument/product and be tempted by excessive promotional offers. Pay close attention to the investment products offered, so you don’t get caught up in fraudulent investments. The following are the characteristics of a fraudulent investment:

  1. The entity offering the investment does not have a permit from the competent authority (legality is not clear);
  2. Promises big profits in a short time with no risk;
  3. Offer investment products through social media, Whatsapp groups, Telegram, which include photos of artists, religious figures, or public figures;
  4. Information related to the investment business process is not clear
  5. Offering benefits (bonuses) if you manage to get a new member;
  6. Promise that the assets invested are safe and provide a buyback guarantee.

In addition to expecting future profits, investing also has risks. The following are some of the risks of investing, especially in the capital market, including the following:

1. Purchasing power risk

This risk is related to the possibility of a large inflation rate so that the real value of investment income will be smaller.

2. Business risk (business risk)

Business risk is a risk that the company’s ability to earn profits will decrease, which in turn will reduce the company’s ability to pay interest and dividends.

3. Interest rate risk

An increase in interest rates will usually depress the price of securities, so that the impact of the value of securities will decrease.

4. Market risk (market risk)

If the market is bullish (bullish) in general, stock prices will increase, and vice versa if the market is sluggish (bearish), stock prices tend to fall.

5. Liquidity risk

This risk is related to the ability of a security to be traded immediately without experiencing significant losses.

By being aware of every risk that must be faced in investing, you need to adjust the investment instrument/product to your risk profile, financial condition, and financial goals. In addition, make sure you invest using cold funds, aka money that is really not used to meet life needs or emergency funds. That’s an explanation of the things that need to be understood in investing. So friends, let’s start investing to reach a brighter future!

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